01Do USDA loans really require no down payment?+
Yes. The Guaranteed program offers 100% financing for eligible buyers and properties. That does not mean every closing is cash-free: appraisal gaps, closing costs, prepaid taxes, and insurance can still require funds.
02Does the home have to be on a farm?+
No. This is a homeownership program, not a farm loan. Eligible locations include many smaller communities. The exact address must qualify on USDA’s map, and the home must meet property standards.
03What are the income limits?+
USDA applies local household-income limits, generally based on 115% of area median household income and adjusted for household size. Income from household members who are not borrowers may count. Allowable deductions affect eligibility, so household eligibility income differs from the income used to qualify for the payment.
04What credit score do I need?+
USDA does not set a minimum score for the Guaranteed program. Individual lenders set credit requirements, and applicants must demonstrate a willingness and ability to repay debt. A low score or limited credit history still needs underwriting review.
05What fees does USDA charge?+
Current Guaranteed program fees are 1% upfront and 0.35% annually. The upfront fee can generally be financed. The annual fee is collected monthly and is based on the scheduled outstanding balance. Other loan closing costs also apply.
06Can I use USDA for an investment or vacation home?+
No. The property must be your primary residence. The Guaranteed program does not finance investment-only properties, vacation homes, or income-producing farms.
07Can closing costs be covered?+
Yes. Eligible gift funds and assistance can help, and seller contributions may cover eligible costs up to 6% of the sales price. Some costs can be financed if the appraised value supports them and program rules are met. No down payment does not automatically mean no cash to close.
